When gas hits $20 per gallon

Posted: Tuesday, August 25, 2009

By Carlos Lozada

When gas prices reached $4 a gallon in the summer of 2008, panicky American commuters changed their vacation plans and dumped their SUVs. So imagine if prices hit $6 or $8. We'd see riots, right? And at $10 or $15, might we have a second Great Depression - for real this time? And if a gallon of gas cost $18 or $20, would the nation descend into a sort of post-motorized Lord of the Flies?

Well, Forbes reporter Christopher Steiner has imagined it, and his advice is not to worry. In his new book "$20 Per Gallon: How the Inevitable Rise in the Price of Gasoline Will Change Our Lives for the Better," Steiner posits that expensive oil, while traumatic as it becomes reality, will ultimately make America a cleaner and healthier nation.

Each chapter forecasts our lives at a different price per gallon. At $6, public transportation becomes "the belle of the ball," with subways overflowing and new train routes proliferating. Driving deaths and obesity both plummet. Say goodbye to the yellow school bus - unaffordable.

At $8, "the skies will empty" as the airline industry contracts and ticket prices spiral upward. Vegas goes back to being just a desert.

At $12, families abandon the suburbs and cluster in cities, sparking a renewal of commerce and culture from Atlanta to Cleveland.

A price of $14 per gallon of gas marks the death of Wal-Mart as global shipping costs become prohibitive. Manufacturing firms rediscover small-town America. Onetime suburbs morph into farms for local markets when gasoline reaches $16, as the costs of transporting fresh food skyrocket. Eat your toro sushi while you can.

Finally, when gas prices top out at $18 or $20, high-speed rail takes over nationwide and nuclear power becomes "the clear choice" for most of our energy.

The ground Steiner covers is not entirely original, of course, and the gaps in the tale (What happens to the Middle East? How do rich and poor deal with rising gas prices differently?) are far from trivial. But as thought experiments go, Steiner offers an interesting, counterintuitive case - one that part of me hopes we'll never have to put to the test.